Data are the raw facts, figures, or ideas that may take the form of numbers, text, or pictures. It is difficult to obtain meaningful results by observing the raw data. Therefore, it should be processed and transformed into an understandable and organized format. The processed data is known as information. For example, the figures, such as $4,000 and 10%, are raw data. However, the processed data, such as the revenue generated per day on the item sales with the 10% discount on the cash payments is $4,000, is information. At times, information in one context may become data in another. For example, consider a situation wherein you want to know the annual status of the cash books and the bills receivables. For this, you need to calculate the revenue generated from the cash transactions and the credit transactions individually. In this case, the information obtained in the preceding example becomes data.

Note :

• The bills receivable accounts books store the details of the credit sales. The bills payable accounts books store the details of the credit purchases.

• Cash books store the details of all the cash transactions .

What is Information Analysis ?

Organizations need to collect the data related to the business entities and the day-to-day business transactions from different sources. For example, the details of:

• The daily business transactions are stored in the respective sale or purchase ledgers.
• The cash transactions are stored in the cash books.
• The credit sales are stored in the bills receivable books.
• The credit purchases are stored in the bills payable books.

However, the data stored in these account ledgers canno be used to take the important business decisions directly. Therefore, you need to collect and process the data stored in these sources to obtain the useful and required information.

The similar sets of data can be processed in different ways to obtain the different types of information when required.

Information can be classified into the following types:

• Strategic: This type of information is required by the users to create the business policies by taking the long-term decisions. These decisions are taken on the basis of the future goal and vision of an organization. The strategic information requires large volume of data, which may be collected from various sources. Thus, this information is difficult to consolidate and obtain.

• Operational: This type of information is required by the users to run the day-to-day business operations successfully. The volume of the operational information is more than the volume of the strategic information.

• Statistical: This type of information is the systematic presentation of facts and numerical figures related to various entities, such as the production of crops, the population of a region or a country, and the trade report of a company. The facts and figures can be the result obtained through different kinds of the mathematical analysis or the scientific analysis.

The process of collecting, refining, examining, and evaluating the strategic, operational, or statistical information to take the useful decisions is known as information analysis. Information analysis is the fundamental life-support system for any organization for its sustainability, continuity, and growth, whether it is a commercial organization or a nonprofit organization. Effective planning, monitoring, and control are the important constituents of a growing business, which can only be achieved through information analysis. In addition, it provides a vital input to strategize the business plan. The information analysis has the following benefits:

• It allows organizations to identify market trends. The knowledge of market trends is required to make the necessary changes in the current business process.
• It provides solutions to the business problems.
• It enables the top-level Managers to track the organization’s performance so that effective actions can be taken when required.
• It enables the organization to create business strategies and tactics to sustain in the competitive business world.
• It helps the organizations to perform day-to-day business operations successfully .